As human beings, we all have inherent dignity. We are worthy of respect and value. This ideal is true regardless of background or circumstance. Our understanding of self-worth—of dignity—is highly influenced by how people and institutions treat us, including our employers.
Dignity at work should reward our growth through education, skill, and experience, but no matter what, it should ensure the basic economic security and stability of all workers. Work should allow people the opportunity to grow wealth that they can use to build a comfortable life. It should advance their physical, social, and economic well-being and that of their families. In essence, work that reflects people’s inherent dignity is the sum of competitive wages and benefits, professional growth opportunities, respectful treatment, workplace safety, and worker empowerment—the ability to offer meaningful input on workforce policies, pay, and processes.
Several Southern states consistently rank among the top 10 “best for business” in the nation. However, the economic system that works for business isn’t working for Southern workers. With low wages, limited protections for working parents, and anti-union policies, our region is home to eight of the 10 worst states for workers. The status quo of exploitative labor means that many Southern workers have limited chances to attain economic stability, build wealth, and leave future generations with enough of a financial foundation to live their version of the “American Dream.”
Every Southern state apart from Virginia has a median household income below the nationwide median. While Southerners are the most likely to believe in the promise of upward economic mobility,[i] children born into low-income families in the South have a lower economic mobility rate than in any developed country where data are available.[ii] In all Southern states, Black, Hispanic/Latine, and Native communities experience higher rates of poverty than White communities. Even in West Virginia, which has the highest poverty rate for White residents among Southern states, the rate of poverty is still lower than the lowest poverty rate for Black residents in the South (in Virginia). This bleak economic outlook holds true for Hispanic/Latine and Native communities across the region. In other words, not only is poverty concentrated in the South, but it is entrenched, intergenerational, and racially stratified.
Poverty and race in the South, 2020
Fair Wages
Since early 2020, the Southeast has accounted for more than two-thirds of all job growth across the US. But what kind of economic growth is occurring in the South? From 1990-2021, the South experienced notable job growth in low- and high-wage industries but limited growth in middle-wage industries. At the same time, wages in low- and middle-wage industries have remained relatively stagnant (34% and 23% increase, respectively), while high-wage industries have seen earnings skyrocket (81% increase). This kind of growth negatively impacts everyone, particularly women and people of color who are overrepresented in low-wage jobs.
Growth in low-wage jobs from 1990-2021
According to the National Equity Atlas, “strong growth in middle-wage jobs and rising wages for low-wage workers are hallmarks of inclusive growth,” but this type of growth is limited in the South. Cheap labor is a key driver of the region’s past and present economic success, but a new economic development model is needed to ensure all workers benefit in the economic prosperity that their labor creates.
Welcoming workplaces
In an economy that recognizes the inherent dignity of all people, both pay and inclusion must be prioritized. Workers are more likely to stay on the job when they feel they belong. This can be difficult for immigrants, people of color, and others who face both explicit and implicit bias in the workplace.
As the South grows increasingly diverse, employers must be prepared to welcome people from a variety of backgrounds—otherwise, they might miss out on important economic development opportunities. This shift is especially important in the South’s rural communities, which absorbed 65% of the people nationwide who moved from metropolitan to nonmetropolitan counties in 2021. In order to be economically competitive, these communities must cultivate inclusive environments where workers feel welcome. That’s why Brushy Fork Leadership Institute created “People Ready Communities,” a program in central Appalachia that builds local capacity to attract and welcome a diverse workforce.
Equally as important are the supports available for diverse entrepreneurs. In 2023, the Southeast saw the highest number of new business applications in the nation at 1.4 million. Although not every application results in a business, this number represents the region’s entrepreneurial potential—potential that can only be realized if we address the systemic barriers that make it harder for some people to start a business than others.
One example is Birmingham, Ala., where Black businesses account for only four percent of employer businesses, yet Blacks make up 32 percent of the population. According to the Center for American Progress, “wealth and capital are a prerequisite rather than just a product of entrepreneurship,” and communities of color have been “systematically prevented from accumulating wealth and accessing capital for centuries.” While many White people can afford to take risks that might increase their financial stability over time, people of color are not often in a financial position to take that leap. Those who try often end up with smaller loans and greater financial challenges than their White counterparts. Entrepreneurship is an important wealth-building strategy, but more work is needed to ensure all communities are able to access the support needed to start and sustain a business.
Worker Voice
Work that reflects people’s inherent dignity is not just about the paycheck, but also about rational bargaining over total compensation and the conditions of one’s work environment. In other words, work that allows people to unionize.
Unions give workers a seat at the bargaining table and protect their place and well-being in the workplace. Unfortunately, the National Labor Relations Act (NLRA), which established workers’ right to organize in 1935, excluded agricultural and domestic workers from essential labor law protections. This exclusion established a two-tiered system of labor: an upper tier with collective bargaining power and legal protections and a lower tier without it. It was no accident that this lower tier was dominated by Black workers in the South.
The legacy of racist policies like the NLRA continues today. Every Southern state has “right to work” laws on the books, which allow workers at union shops to opt out of union membership, undermining the union’s ability to bargain. Many Southern elected officials supplement these laws with anti-union rhetoric. Meanwhile, farmworkers, domestic workers, and millions of other Southern workers live in economic precarity while providing goods and services our country relies on daily.
To be clear, unions have had a history of discrimination and exclusion that have made economic mobility less attainable for some, particularly women and people of color. But if the modern democratically-led and racially diverse labor movement expands, all workers stand to benefit—including those who aren’t unionized, since employers have to compete for their labor. We have seen what collective action can do in the South to uplift workers when a worker’s rights movement in Durham, N.C., organized widespread sickouts and pickets that resulted in increased compensation across the board. Unfortunately, unions are still tiptoeing but not yet firmly established in the South.
Another mechanism for strengthening worker power is worker cooperatives. Cooperatives democratize wealth rather than concentrating it. Cooperatives share risks and rewards, as profits go directly to workers, often building community wealth by keeping dollars local. The South has a legacy of cooperative development, especially in rural communities. Today’s co-ops are found in both rural and urban communities and are increasingly used as a tool for wealth-building in communities of color. In Morganton, North Carolina, The Industrial Commons has launched four community-owned businesses and supported more than 2,500 workers through its collaborative, member-led network. Increased investments from philanthropy and government could help grow the number and impact of similar cooperatives throughout the South.
Voices from the Ground
The economic development strategy favored by Southern states—economic incentives in the form of tax refunds and credits coupled with largely union-free workforces that prevent collective bargaining—has resulted in a boom in low-wage jobs. This strategy has generated economic vitality for some and economic insecurity for others. To build a South where all people thrive, policymakers, business owners, and community leaders need to develop a workforce culture that reflects the dignity of workers.
In the stories that follow, we hear from inspiring leaders who are working to build an inclusive economy that recognizes the inherent dignity of all people throughout the South.
- Gilda (Gigi) Pedraza, Executive Director and Founder of the Latino Community Fund Georgia, gives voice to the thousands of Hispanic/Latine farmworkers in Georgia who produce our food, pay taxes, and contribute to our communities, yet whom our economic systems continue to exclude and exploit.
- Peter Hille, Chief Executive Officer of the Mountain Association, lends insight to the history of coal production in Appalachia, how its promise was never fully realized, and how rural communities must invest in diverse businesses and quality of life to rebuild economies that work for everyone.
- We also hear from members of MDC’s Educational Equity team who amplify the voices of home-based childcare providers in their call for fair treatment and compensation within a system that does not fully recognize their worth.
Authored by MDC
MDC envisions a South where all people thrive. We work with partners to strengthen community capacity, foster collaboration, and build influence to challenge systemic inequities and build an equitable and inclusive South.
[i] Cohen, “Southerners, Facing Big Odds, Believe in a Path Out of Poverty,” The New York Times (Jul 4, 2019).
[ii] Raj Chetty et al., “State of the States 2015,” Pathways (Stanford Center on Poverty and Inequality, May 15, 2015), https://doi.org/10.4324/9780429499821-38, 55.
